Boeing agrees to plead guilty, pay $487M to address violation of 2021 DPA

In the settlement, filed Sunday in U.S. District Court for the Northern District of Texas, Boeing agreed to plead guilty to one felony count of making material misstatements to the Federal Aviation Administration (FAA) regarding compliance and safety issues.

The company, which will be placed on probation for three years, also agreed to invest at least $455 million to improve its compliance and safety programs. The DOJ will impose an independent compliance monitorship for three years. The company may also have to pay additional compensation to the families of the 346 people killed in two crashes of Boeing airplanes in 2018 and 2019, subject to a ruling by the federal judge overseeing the case.

The settlement still needs to be approved by the judge. The families of those killed in the crashes are likely to oppose it, according to the settlement.

In May, the DOJ notified Boeing that it had breached the terms of a deferred prosecution agreement (DPA) by conspiring to defraud the FAA’s Aircraft Evaluation Group during evaluation of its 737 MAX, specifically regarding technical pilots concealing material information about a critical part of the aircraft that impacted its flight control system.

The result was key FAA documentation, including airplane manuals and training materials, lacking necessary information that led to the crashes of Lion Air Flight 610 and Ethiopian Airlines Flight 302 in 2018 and 2019, respectively.

In March, the FAA said it found multiple instances where Boeing “failed to comply with manufacturing quality control requirements,” including parts handling and storage and product control. In response to the incident, the airline regulator halted production expansion of the 737 MAX.

Boeing had agreed to the DPA in January 2021 as part of a $2.5 billion settlement over criminal charges related to the 737 MAX scandal. At the time of the settlement, the DOJ had determined that assigning an independent compliance monitor was unnecessary.

In an emailed statement, a Boeing spokesperson said, ”We can confirm that we have reached an agreement in principle on terms of a resolution with the Justice Department, subject to the memorialization and approval of specific terms.”